Cuba 2013: A Cautious Forecast

Cuba 2013; A Cautious Forecast

The “good news” keeps on coming from the Palace of the Revolution. The construction materials industry will grow 5.4% The electrical energy supply will increase 2%. Planned investments at 34%. Construction at 20.8%. Domestic travel will reach 10.1%. Labor productivity is estimated to grow 2.6%.

The finishing touch to these official forecasts is that tourism figures will surpass three million visitors. The military overlords, who control 80% of the nation’s wealth, claim it will be a good year economically. But the macroeconomic figures do not trickle down to Cuban households. For the last twenty years a basket of essential goods and services has consumed 90% of a typical family’s income.

Having three meals a day is a luxury in Cuba. Most people have black coffee and bread with oil for breakfast. Or they do not have breakfast. Families try to see to it that the ill, elderly and children have lunch at home. For a large segment of the population lunch is bread and croquettes or pizza prepared at small, privately owned cafes. At night, dinner ideally consists of rice, beans, egg, pork or chicken, and salad or a seasonal vegetable.

But there are not always beans and meat. Right now procuring food is Cubans’ number one concern. High food prices make it difficult for many people to satisfy their nutritional needs.

For several years now General Raul Castro has recognized that guaranteeing the bean supply is more important than having a fleet of T-62 tanks at the ready. The inefficient agricultural and livestock industry has not been able to guarantee a steady supply of dairy products, meat, legumes, produce, fruits and vegetables at prices commensurate with the poverty-level salaries that Cuban workers earn. Management is inefficient in other sectors as well. The water supply in Havana, for example, is often accessible only every other day. In villages such as El Calvario distribution occurs one out of every three days.

This has forced many families along the width and breadth of the island to install supplemental facilities for storing water. These are regularly found to be uncovered, in bad repair and infested with swarms of mosquitoes, which transmit dengue fever. Cholera has also reappeared due to the shortage of clean drinking water.

Another day-to-day problem for the average Cuban is public transport. We do not have a subway line in Cuba. The suburban rail system is barely functional and modestly priced taxis do not exist. The only way then to get from one location to another is by city bus or private taxi, which charge ten to twenty pesos a ride.

Five years ago a network of articulated buses was introduced in Havana. There were seventeen lines that ran along the city’s main thoroughfares, and were spaced five to ten minutes apart at peak hours. More than 200 are now out of service due to a lack of replacement parts. The bus shortage has led to the collapse of the capital’s public transportation system.

The optimistic economic figures do not take into account repairs to the innumerable water leaks in towns and cities. Or repairs to streets and multi-family apartment buildings. The government claims that the sale of construction materials unsubsidized by the state will grow for years to come.

But if you visit one of the markets where they are sold, you can almost never find what you need. To say nothing of the high prices. Not everyone can afford to pay 90 to 110 pesos for a bag of cement. Or 10 pesos for a cinder block or a brick.

I have reviewed the 2013 economic forecasts, but have not seen anything to indicate that the government intends to study, address or resolve the issue of low wages. Or the contradiction of having two currencies in circulation within the country. And one of these, the principal one being the convertible peso or CUC*, is not used to pay the bulk of workers’ salaries.

Any rational analysis would show that a family of four, that hopes to live comfortably, must have an income of no less than 6,000 Cuban pesos or 240 Convertible pesos (CUCs). The average salary in Cuba is 400 Cuban pesos. Such insolvency is the cause of low productivity and poor quality in industrial manufacturing. Many go to work simply to steal whatever they can.

Work schedules are ignored. Stores open half an hour after the posted time and close half an hour before. In stores and markets cash counts and audits in the middle of the day are routine, paralyzing sales.

The average Cuban is not a habitual slacker. He has demonstrated his industriousness and creativity in places he has settled, such as Florida. But he feels he has not been sufficiently motivated to work long and hard in his homeland. These days, in conversations among people waiting in line, there is skepticism about the government’s encouraging predictions.

Amid the “good” economic forecasts is a fundamental issue on which the regime would prefer not to comment. That is the state of health of President Hugo Chavez, who remains bedridden in a Havana hospital. An atmosphere of suspense and secrecy surrounds the formidable chief executive.

No one knows with certainty if his swearing-in on January 10 will take place in Caracas or in a medical clinic in Havana. If it becomes impossible for Hugo Chavez to retain office in 2013, the force of such a political earthquake will strongly impact Cuba, whose economy is highly dependent on the 100,000 daily barrels of oil provided at favorable prices by the generous Venezuelan.

A new government, even one led by Chavez supporters, would lead to an anxious waiting period on the island. The Chavez factor is more important to the Castros than the rosy published economic predictions.

Without Chavez, 2013 will be a tough, dark year in Cuba. The Creole autocrats are doing everything within their power to assure that their optimistic forecasts do not go off track. From a mass for the Bolivarian comandante in a Catholic church to the orishas of the Afro-Cuban religion, anything goes.

Iván García

*Translator’s note: The convertible peso, or CUC, is one of two official Cuban currencies and is pegged at roughly 1.10 to the US dollar. Many essential goods are sold only at government-run hard currency stores, which accept payment only in convertible pesos.